Real estate owners are hunting for customers to buy their apartments as they tackle the dilemma of an acute shortage of funds.
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| An artist’s impression of Happy Plaza apartment building in Binh Chanh District, Ho Chi Minh City (File) |
The real estate market is also coping with high lending interest rates while the stock market continues to go down.
Project developers are panic selling apartments still under construction or selling entire real estate projects to manage their funds.
PetroVietnam Power Land Joint Stock Company has just begun to sell apartments from the Petrovietnam Landmark condominium project in District 2 in Ho Chi Minh City, at VND19.9 million (USD961.35) per square metre.
Construction of the condo project has just completed laying its foundation level.
The owner of R apartment building in a prime location in District 7 has run out of funds and is paying the project contractor by selling apartments at VND20 million (USD966.1) per square metre whereas the neighborhood condo prices are actually VND40 million (USD1,932) per square metre.
Since there is no market for apartments now, Saigon Land JS Company is investing in buildings to raise salangane, a species of sea bird whose nest can be used as food. A kilogramme of nests currently sells for over VND30 million (USD1,449).
Meanwhile, the developer of Aroma condo project in Binh Duong has offered over 100 taels of gold to those who buy apartments in Aroma Building.
Reselling projects
Besides lowering the selling price, many apartment developers have been looking for buyers to resell their projects.
For instance, Dat Xanh Real Estate Service and Investment JSC bought a condominium project from Ha Thuan Hung Company Ltd. to build a 14-floor apartment building on an area of 3,700 square metres in Go Vap District, Ho Chi Minh City.
Hoa Binh Construction and Real Estate Company has now resold its land rights to Dong Duong Company. Dong Duong Co. has paid Hoa Binh Co. USD11.9 million for use of 2,700 square metres of land in South Saigon, District 7.
Early in 2011, Vina Land under Vina Capital Group, a leading asset management, investment banking and real estate consulting firm in Vietnam, completely transferred its shares in the International Housing project in District 9 of Ho Chi Minh City at a total price of USD10.9 million.
Earlier, Vina Land sold 85 percent of its shares in the Mandarin Garden complex project in Cau Giay District in Hanoi.
Vina Development Inc. has sold all its shares in the Blooming Park condo project in District 2 of Ho Chi Minh City to Prudential Vietnam.
Troy Griffiths, from the Research and Valuation Department of Savills Vietnam, said many local realty investors have land but they have problems accessing capital. Therefore, a trend toward cooperation with foreign investors will continue, not just this year but also in the years to come.
Meanwhile, Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association, said real estate enterprises are facing a most difficult year, since they have had to pay higher lending interest rates while being unable to sell their apartments.
Realty companies have launched many promotional programmes and lowered their selling costs to less than cost price, to survive.
